Weekly Outlook | Jerome Powell is pushing markets
Updated Updated Wed, 2025 August 27 02:34
Important events this week:
Last week the Dollar initially geared up some steam causing the risk sentiment to fade. Equities lost momentum and also cryptos were trading lower. Hower, dovish statements during the symposium in Jackson Hole caused a major shift. The Fed chairman pointed out that it might be time to cut interest rates “as risks are shifting.” This paved the way for a potential rate cut in September, which has been expected by the majority of market participants. Following the speech indices like the S&P 500 and Nasdaq were gearing up steam and the Greenback sold off. Also, cryptos followed the news in anticipation of a weaker Dollar. The positive momentum in markets might also continue this week.
This week only limited important data will be released so the focus should remain on geopolitical tensions as well as the development in the US economy.
– AU – consumer price index– The consumer price index from Australia might have the potential to move markets. After the cut in rates in New Zealand by the RBNZ also the AUD lost steam initially. Yet, after the remarks of Jerome Powell in Jackson Hole the AUD was able to rise again, potentially offering fresh upside momentum.
AUDUSD weekly chart
Based on the weekly chart the market was able to defend the 50- moving average, which could be seen as a positive sign. Positive consumer prices might then support the bullish scenario and could push the market higher. Caution should be taken with a miss of the release, which is expected to come at 2.3%. Then the AUDUSD could also move lower again. The CPI data from Australia will be published on the 27th of August, 2025 at 03:30 CET.
– US Core PCE price index– This week the core PCE index will be in particular interesting as it might offer further insights into the decision- making process of the Fed. The index is expected to come at 0.3%, which is the same as last month. Any deviation might move markets, where a miss of the number might offer a sharper reaction, as the anticipation that Jerome Powell will cut rates remains high for now.
XAUUSD daily chart
The gold price might offer some volatility following the release. A weaker reading of the PCE- price index could cause the Dollar to lose some momentum, due to the expectation of the Fed. The gold prices might hence move higher. Especially a breakout above the technical resistance zone at USD 3430 could ignite a sharp rise in prices. On the flipside a break below the 50- moving average at USD 3.336 could cause the rising trend to be broken. The data from the US will be released on the 29th of August, 2025 at 14:30 CET.
